Credit crunch and its spatial differences in Japan's lost decade: What can we learn from it?

Daisuke Ishikawa and Yoshiro Tsutsui ()

Japan and the World Economy, 2013, vol. 28, issue C, 41-52

Abstract: In this paper, we aim to elucidate whether effects related to supply or demand contributed to the Japanese “credit crunch” in the 1990s. Using prefectural panel data, we estimate loan supply and demand functions and calculate their shifts. Our analysis reveals that demand-side effects contributed to the Japanese credit crunch to an equal or greater degree than supply-side effects. Further, we show that the credit crunch was not uniform across Japan, but was more severe in urban relative to rural prefectures. These findings suggest that traditional countermeasures in the banking sector that similarly affect all prefectures may not induce economic recovery. Given this, we assert that region-specific policies may be more appropriate.

Keywords: Credit crunch; Prefectural panel data; Shift of functions; Japanese loan market (search for similar items in EconPapers)
JEL-codes: E51 G21 R51 (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0922142513000327
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:japwor:v:28:y:2013:i:c:p:41-52

DOI: 10.1016/j.japwor.2013.06.005

Access Statistics for this article

Japan and the World Economy is currently edited by Robert Dekle and Yasushi Hamao

More articles in Japan and the World Economy from Elsevier
Bibliographic data for series maintained by Catherine Liu ().